The Supreme Court upheld the 2020 amendment to the Foreign Contribution Regulation Act (FCRA) to regulate foreign funds received by NGOs.
Right to life and liberty under Article 21 does not encompass the right to receive unregulated foreign contributions, the Central government had told the Supreme Court while defending amendments made in 2020 to the Foreign Contribution (Regulation) Act (FCRA).
A three-judge bench of Justices A.M. Khanwilkar, Dinesh Maheshwari and C.T. Ravikumar has pronounced the judgment on a plea filed by Noel Harper of NGO Care And Share Charitable Trust challenged Sections 7, 12A, 12(1A) and 17 inserted in the FCRA by the Foreign Contribution (Regulation) Amendment Act, 2020 as ultra vires Articles 14, 19 and 21 of the Constitution of India.
The Apex Court answered in the affirmative to questions as to whether changes made through the Foreign Contribution (Regulation) Amendment Act, 2020 by amending the Foreign Contribution (Regulation) Act, 2010 are constitutional or not.
The Court had previously stated that there is a need to ensure that the funds received by NGOs from foreign countries are not misused. And it is used only for the purpose it has been sought.
The petitioners said 19,000 NGOs have been invalidated. This shows that the system is working. The petitioners further said that they have not challenged the original FCRA but only the amendments made to it.
The petitioners contended the compulsion to open an account with an SBI branch is clearly arbitrary and violates the right to equality and serves no reasonable purpose. Apart from this, the petitioners also argued that the amendment lacks a legitimate purpose and will have an adverse effect on NGOs.